A freight brokerage merger or acquisition can be a stressful venture for all involved. Business continuity is important for the buyer, your employees, and you. You don’t want a buyer to bail on the deal, and you certainly don’t want the buyer to culture-shock your employees. According to McKinsey and Company, “Cultural factors and organizational alignment are critical to success (and avoiding failure) in mergers. Yet leaders often don’t give culture the attention it warrants—an oversight that can lead to poor results. Some 95 percent of executives describe cultural fit as critical to the success of integration. Yet 25 percent cite a lack of cultural cohesion and alignment as the primary reason integration efforts fail.” The best way to ensure the process goes smoothly is to find a buyer who is the best cultural fit. In this post, we’ll share questions to help you identify if a potential buyer’s culture aligns with yours to ensure business continuity and a lasting legacy.
Question 1: What are their core values?
While they don’t need to be exact, their values should be compatible with yours. According to Michele Hamill, CHRO at JAGGAER (a spend management solution), “It can be helpful to proactively examine each of the cultural characteristics and develop a common language and understanding of perceptions. Focus on identifying the areas where the most commonality exists and building appreciation for the value of the differences that each organization brings.” A few examples of core values and questions to ask around them are:
- Giving back to the local community. How does the company support volunteerism?
- Onboarding and professional development for employees. What are their training and development opportunities?
- A focus on health and safety for employees. How does their company ensure the welfare of the employees?
Core values are explicit and easier to identify, but don’t overlook or underestimate other less explicit culture- building qualities. What other perks do they offer? Even donuts on Friday can go a long way in keeping up morale. Do they do/provide anything that makes employees’ jobs easier?
Question 2: What is their leadership style?
If your leadership style is different from the acquiring company, you’ll need to figure out how to integrate in order to not lose some of your best employees. In the merger between Nest and Google, the CEO of Nest, Tony Fadell and many other employees left due to the opposing leadership style at Google. Unfortunately, Fadell was a key factor in why Google wanted to purchase Nest.
Examining the acquiring company’s leadership style will uncover similarities and differences between your culture and theirs. Assessments are often accomplished through one-on-one interviews, focus groups, and surveys, although artificial intelligence sentiment analysis tools are gaining popularity. No matter how they are carried out, it’s essential to get the whole company’s perceptions, not only the C-suite executives.
Question 3: What are their pay, benefits, and overtime policies?
If a buyer has less attractive pay and benefits, there will likely be more turnover. While some turnover is inevitable, you will need to create a retention plan that extends for no less than six months past day one to protect the deal and keep the best employees.
While companies are unlikely to have exactly the same pay and benefits, finding a buyer who more closely aligns with yours will make the transition easier.
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If you have considered selling your logistics company and have questions, contact our CEO and President Mike Monson at 317-650-3101.